Capped Option

Capped Option

An option contract that establishes a maximum profit for the holder. Capped options contain a provision stating that the option is automatically exercised if the underlying security closes on a trading day above (for a call) or below (for a put) some established price. This means that if the underlying security moves in a direction disadvantageous for the writer, there is a maximum amount the writer can lose. A capped option is also called a capped-style option.
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Under the capped option, the losses would be greater - around PS5.
Roberts, Chief Financial Officer, exercised capped options over ordinary
In June of 1997, the Amex capped options transaction fees for certain customer and professional trades exceeding 2,000 contracts and 3,000 contracts per day, respectively.
Counsel, exercised capped options over Intu Properties plc shares